News Briefing - Crowdfunding, SME And Alternative Finance

people in an airport, man using laptop

1. UK – FinTech

The UK financial regulator has ordered Wirecard’s UK subsidiary, Wirecard Card Solutions (WCS), to halt all activities just 24 hours after its German parent company filed for insolvency. AltFi reports:

"It’s a move which will have ramifications for dozens of fintechs and tens of thousands of UK customers who will likely be unable to access funds which are passed through WCS. 

“Our primary objective is to protect the interests and money of consumers who use Wirecard,” wrote the FCA in its order

“We have been working closely with Wirecard UK and other authorities over the past few days to take action that protects consumers. We are continuing to do this and on 26 June, we took additional measures to require the firm to cease allsregulated activities in order to further protect customer money.” 

2. UK – FinTech

FinTech Futures reports:

Picnic Bank, a UK start-up focused on ‘fintech for good’, is set to launch its small and medium-sized enterprise (SME) lending platform in September, before rolling out its fully licensed banking service sometime next year.

Currently looking to raise £5.5 million, Picnic Bank intends to put £3.5 million towards its UK banking licence and building bank operations, whilst the remaining £2 million would be lent out to SMEs straight away.

The lending platform will be an unusual mixture of institutional investments and crowdfunding, with the idea that the “community can uphold its merchant”, CEO Zoe West tells FinTech Futures. West explains that the start-up intends to use white-labelled technology – potentially sribal Bank’s –sto get to market faster.

Whilst Picnic Bank lends to SMEs, earning interest on the loans, and taking referral fees from partners, it intends to build its bank in the background. But upon launch in September, West says it will be offering payment cards alongside its lending service until the full bank comes into play.

The fintech’s advisory board includes former Swift board member, Tony Fish, ex-RBC/Coutts exec, Mark Hsouse, and eToro’s managing director, Iqbal Gandham.

3. UK - FinTech

UK Tech News reports:

“Equity investment in the UK’s tech businesses increased by 27% in 2019 to £4.0bn, the highest amount since the series began in 2011, reveals the British Business Bank’s annual Small Business Equity Tracker report.

The UK’s thriving tech sector remains highly attractive to equity investors, accounting for 47% of total equity investment in UK SMEs through 691 deals in 2019.

Within tech, the sectors receiving the largest share of deals were software (425 deals worth £2bn) and life sciences (78 deals worth £540m). The verticals attracting the greatest amount of equity investment in 2019 were Software as a Service (471 deals worth £2.5bn), FinTech (193 deals worth £1.8bn) and AI (173 deals worth £880m).

Software as a Service companies in particular were highly attractive to equity investors, with investment value increasing by 69% in 2019 compared to 2018, a much larger increase than that seen in the overall market.

The Small Business Equity Tracker report, which analyses Beauhurst data on equity investments throughout the UK in 2019, provides an important benchmark of the market immediately prior to the Covid-19 pandemic.”

 

4. UK – FinTech

 

P2P Finance News quotes Money&Co. CEO, Nicola Horlick, as saying lockdown should have been ended earlier.

5. UK – AltFi

The Covid-19 pandemic has prompted a rise in demand for high-cost borrowing, according to new research reported by AltFi. 

“With economic uncertainty increasing, a survey of 2,000 UK adults sponsored by Credit Kudos found that nearly three in ten people (28 per cent) have had their sncome impacted by Covid-19. A quarter (26 per cent) have already had to borrow, taking out £1,719 on average. 

More than a half (51 per cent) of people who are currently borrowing have had to turn to high-cost credit, such as payday loans or guarantor loans. 

This trend looks likely to continue with more than one in five (21 per cent) expecting they will need to start borrowing or borrow more over the next three months and 86 per cent of those who have already taken out credit expect to continue to do so.”s

 

6. US – FinTech

The FinTech Times reports:

Vesta, a fintech pioneer in fraud protection and fully guaranteed payment technologies, has secured $125 million in new growth capital from private equity firm Goldfinch Partners. The funding will provide Vesta with the resources to invest in growth and continue the global deployment of its fraud protection and e-commerce payment solutions.

Vesta enables e-commerce companies to grow their businesses by focusing on revenue rather than risk, with its zero-risk and zero-liability payment guarantee. Vesta’s real-time descisioning platform — built on data science and machine learning with more than 25 years of intelligence — analyzes customers’ online payment transactions to assess the risk of fraud. Eliminating the fear of fraud and ensuring that more good transactions are approved increases revenue and ultimately profits. Today, Vesta provides its service to partners in the tslecommunications and e-commerce industries and allows merchants to seamlessly integrate through shopping cart plug-ins, including Magento, Shopify, Salesforce, WooCommerce, BigCommerce and SAP Commerce Cloud. Vesta, a fintech pioneer in fraud protection and fully guaranteed payment technologies, has secured $125 million in new growth capital from private equity firm Goldfinch Partners. The funding will provide Vesta with the resources to invest in growth and continue the global deployment of its fraud protection and e-commerce payment solutions.

 Vesta enables e-commerce companies to grow their businesses by focusing on revenue rather than risk, with its zero-risk and zero-liability payment guarantee. Vesta’s real-time decisioning platform — built on data science and machine learning with more than 25 years of intelligence — analyzes customers’ online payment transactions to assess the risk of fraud. Eliminating the fear of fraud and ensuring that more good transactions are approved increases revenue and ultimately profits. Today, Vesta provides its service to partners in the elecommunications and e-commerce industries and allows merchants to seamlessly integrate through shopping cart plug-ins, including Magento, Shopify, Salesforce, WooCommerce, BigCommerce and SAP Commerce Cloud.